_________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) March 13, 1998
TOTAL CONTAINMENT, INC.
(Exact name of registrant as specified in its charter)
Pennsylvania 0-23454 23-2394872
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Ident. No.)
422 Business Center, A130 North Dr., Oaks, PA 19456
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (610) 666-7777
N/A
(Former name or former address, if changed since last report.)
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Item 5. Other Events.
In March 13, 1998, the owner of 57.1% of the Company's
outstanding common stock purchased 400 shares of the Company's
authorized but unissued perpetual Class A Floating Rate Preferred
Stock for $4 million in cash.
Attached to this Form 8-K, as an exhibit, is a copy of
the Company's press release relating to this purchase.
Also attached to this Form 8-K is a condensed
consolidated balance sheet of the Company as of January 31, 1998,
adjusted to give pro-forma effect to the issuance of the
preferred as if the issuance had occurred on January 31, 1998.
Item 7. Financial Statements and Exhibits.
(a) Financial Statements:
Condensed Consolidated Balance Sheet of the
Company as of January 31, 1998 adjusted to give
pro-forma effect to preferred stock issuance.
(b) Exhibit:
Press Release dated March 13, 1998
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.
TOTAL CONTAINMENT, INC.
Dated: March 13, 1998 /s/ Pierre Desjardins
Pierre Desjardins
President and Chief Executive
Officer
<TABLE>
<CAPTION>
TOTAL CONTAINMENT, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
PROFORMA
(Unaudited)
Jan 31, Dec. 31,
1998 1997
(In thousands) (In thousands)
ASSETS
<S> <C> <C>
Current Assets:
Cash and cash equivalents $ 4,352 $ 612
Accounts receivable, net 7,961 7,887
Inventories - Note 2 8,311 7,306
Other assets 5,378 5,391
Total current assets 26,002 21,196
Molds and tooling costs, net 904 987
Property and equipment, net 3,997 3,871
Patents, patent rights and licenses, net 4,266 4,293
Goodwill, net 5,366 5,379
Other assets 4,320 4,321
Total Assets $ 44,855 $ 40,047
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Line of credit borrowings 5,383 $ 3,197
Current portion of long-term debt 1,649 744
Accounts payable and accrued expenses 7,911 10,039
Warranty reserve 5,919 6,088
Total current liabilities 20,862 20,068
Long-term debt 2,259 2,305
Warranty reserve 11,234 11,234
Total liabilities 34,355 33,607
========= =========
Shareholders' Equity:
Preferred stock - $0.01 par value;
authorized 1,000 shares;
400 shares issued and outstanding
Common stock - $0.01 par value;
authorized 20,000,000 shares;
4,641,600 shares issued and outstanding 46 46
Capital in excess of par value 17,728 13,729
Retained earnings (7,135) (7,139)
Equity adjustment from foreign
currency translation (140) (196)
Total shareholders' equity 10,500 6,440
Total Liabilities & Shareholders' Equity $ 44,855 $ 40,047
======== ========
</TABLE>
PRESS RELEASE Contact:
Oaks, Pennsylvania Jeffrey Boehmer
March 13, 1998 (610) 666-7777
TOTAL CONTAINMENT, INC. ANNOUNCES ISSUANCE OF $4 MILLION
PERPETUAL CLASS A FLOATING RATE PREFERRED STOCK
Total Containment, Inc. (NASDAQ - "TCIX")
The Company's net loss for 1997, caused by the Company's charge
to income in the third quarter to increase the Company's warranty
reserve, resulted in the Company's net tangible assets (total
assets less goodwill, less liabilities) dropping below the dollar
amount necessary for the Company to maintain the listing of the
Company's common stock on NASDAQ's National Market System.
The Company's Board of Directors and principal shareholder (who
owns 57.1% of the Company's outstanding common stock) believe
that continued listing is important to the Company and to its
shareholders. To accomplish this objective, the Company's
principal shareholder purchased in March, 1998, 400 shares of
authorized but unissued perpetual Class A Floating Rate Preferred
Stock of the Company at $10,000, cash, per share (the "Preferred
Stock"). This $4 million equity infusion is expected to cause
the Company to meet the NASDAQ's net tangible asset test and is
expected to allow the Company to maintain its NASDAQ National
Market listing over the foreseeable future.
The perpetual Preferred Stock is entitled to receive, as and if
declared by the Company's Board, dividends at a floating rate
equal to the rate payable by the Company on its line of credit
with its commercial bank. Dividends are payable quarterly in
arrears, and if not declared or paid would cumulate at the line
of credit rate, plus 50 basis points. The Preferred Stock:
(1) does not possess voting rights, (2) is not convertible into
common stock, and (3) is not redeemable at the option of the
holder. The Preferred Stock is redeemable at the option of the
Company, but only (1) if and to the extent the Company's net
tangible assets at the end of any fiscal quarter exceeded $4.5
million, or (2) if at least a majority of the independent and
disinterested members of the audit committee of the Company's
Board of Directors approve such redemption. The preceding
provision relating to redemption constitutes a covenant between
the Company, the Company's principal shareholder and its
remaining shareholders and may not be changed without the
approval of at least a majority of the independent and
disinterested members of the audit committee of the Company's
Board of Directors.
Total Containment is the leading manufacturer and distributor of
underground systems and products for the conveyance and
containment of petroleum and alcohol based motor vehicle fuels
from underground storage tanks to aboveground fuel dispensers.
If you would like additional information on Total Containment,
Inc., visit our website at http://www.totalcontaiment.com.
